Friday, May 20, 2005

Socialism Continues Its Silent Quest To Eradicate Capitalism

One of the most basic principles of international trade is that all things being equal, the business with the cheapest means of production has the advantage over the business who must charge a higher price in order to recoup its higher costs. This principle underlies the outsourcing phenomenon: business are moving manufacturing and some services to countries offering lower taxes, wages, and transportation costs. Corporations want to attract buyers with lower prices for goods and services, and by locating certain facilities overseas, these corporations can offer the lower prices they desire.

The flip-side to this is the "unfair" advantage of government subsidization. Rather than submitting to whims of the market, governments subsidize certain "favored" industries, often those that are politically popular (university research), or ones that provide a degree of self-sufficiency (farming, steel) to the state. But what happens when a government in a competitive market subsidizes ALL businesses through its social welfare programs?

It had to happen. Some American business executives struggling to compete in the new global markets have come to the conclusion that the United States government should provide pensions and health care for their workers.